The cryptocurrency market has been a hotbed of volatility, and two prominent digital assets, Solana (SOL) and Cardano (ADA), have found themselves in the crosshairs of bearish pressures.
As market dynamics continue to evolve, analysts are closely monitoring the price movements of these tokens, with technical indicators suggesting the potential for further declines.
The token’s price in Solana has been resting precariously on a critical support level, with bulls mustering all their energy to prevent a breakdown. However, the increased selling volume suggests that bearish dominance may prevail in the coming days.
Analysts believe that the SOL price could soon hit levels below $120, marking a significant downside potential from its current trading range.
Since both levels have converged, the Ichimoku cloud, a popular technical indicator that displays support, resistance, momentum, and trend, is not flashing any clear signals.
While this indicator can aid traders in making quick decisions, the current lack of volume support in a bullish direction suggests that a bearish pullback could be fast approaching. Consequently, a substantial drop below $120 appears imminent for Solana.
Technical Analysis Suggests Potential for Further Downside in SOL and ADA Prices
On the other hand, Cardano (ADA) has displayed remarkable strength in recent times, trading within an ascending triangle pattern for over six months. However, the evolving market dynamics have compelled the price to slice through this pattern, inviting extreme bearish pressure on the token.
While the price is currently attempting to prevent excessive downside, bears appear to have a different trend in mind.
Following the recent pullback, the ADA token tested the crucial lower support level below $0.4, leading to a substantial rebound. Despite this, the fractals continue to stay within the bullish range.
The Directional Movement Index (DMI) appears bullish, but from a broader perspective, it is flashing bearish signals. Although the Average Directional Index (ADX) is rising, the positive and negative Directional Indices (+Di and -Di) are about to undergo a bearish crossover.
This technical analysis suggests that the ADA price could potentially re-test the yearly lows at $0.38, a level that could attract significant liquidity to the platform.
As the cryptocurrency market continues to navigate through turbulent waters, investors and traders alike are closely monitoring the price movements of Solana and Cardano. The technical indicators suggest potential for further downside in both tokens, highlighting the need for caution and diligent risk management in this volatile environment.
